People and Culture

Pre-retirement contracts are an option that can be explored by staff with an ongoing contract. A pre-retirement contract is a fixed term contract negotiated with staff transitioning into retirement by either reducing their FTE or working part of the year. The contracts are designed to incorporate variations to current working arrangements to suit the preferences of individual staff while providing a degree of continuity for the work area. The various options available to staff are outlined in the Guide to Pre-Retirement. Pre-retirement contracts are not an entitlement and the University is not obliged to offer or approve requests.

Once negotiated and agreed, the fixed-term contract including variations to working arrangements, will supersede ongoing contract/s of employment and will include a specified term with employment ending, and therefore retirement from ECU at the contract expiry date.

Note that as you will be relinquishing your ongoing status, severance or redundancy provisions do not apply once the pre-retirement contract is signed.

If you are an ongoing staff member with at least a 0.5 FTE, and approaching an age at which you can access your superannuation funds (generally referred to as ‘preservation age’), then you can consider discussing a Pre-Retirement contract with either your line manager or your HR Business Partner. Approved Pre-Retirement contracts should ideally incorporate your preferences without disrupting the operational needs of your work area.

Download the ‘Pre-retirement Workflow’ to see the steps involved in negotiating a Pre-Retirement contract as well as reviewing the ‘Guide to Pre-Retirement’.

A staff member or a manager may start discussions about pre-retirement arrangements. These discussions should consider the various options available. If the terms of a pre-retirement arrangement are agreed, a Pre-Retirement Contract form detailing the arrangement will need to be completed and approved before forwarding to HR Services. A formal Pre-Retirement Contract, replacing your ongoing employment contract, will be issued to you. Acceptance of the fixed-term contract will formalise the arrangement.

Moving to a pre-retirement contract is a change in your employment status from ongoing to fixed-term

• Pre-retirement contracts are usually for a period of 1 to 3 years given the budgeting, succession and workforce planning put in place to support them. Extensions are only offered by the University in limited circumstances and a total contract period cannot extend beyond 5 years.
• You need to seek independent superannuation and financial advice based on your personal circumstances before committing to a pre-retirement contract as there are implications depending on the type of superannuation fund and product you have (i.e. Defined Benefit Plan vs Accumulation Plan).
• If you reduce your fraction, the University will continue to pay the employer superannuation contribution at the pre-conversion rate over the period of the pre-retirement contract
• You may elect to continue paying pre-tax employee superannuation contributions over the period of the contract - something to discuss with your financial planner
• In some circumstances, work arrangements may vary or refocus your current work activities (e.g. teaching, research or specific projects) as part of any pre-retirement contract
• You will still need to participate in the Management for Performance System (MPS) with your performance goals aligning with your school’s/service centre’s operation plan as well as your retirement plans
• You may defer taking all or part of your long service leave entitlement during your pre-retirement contract - leave arrangements may be something you want to include in your pre-retirement discussions

Agreeing to an ongoing staff member converting to a pre-retirement contract needs to be mutually beneficial, meet the operational needs of the work area and be financially sustainable. Pre-retirement contracts are usually for a fixed-term of 1 to 3 years (though can be for 5 years in limited circumstances), and approved by the delegated University authority (i.e. Relevant Line Executive).

• The length of the pre-retirement contract offered needs to be informed by workforce and succession plans – your HR Business Partner will assist you to review these
• Current work activities may need to be varied to accommodate proposed arrangements- there may be impact on responsibilities, operational plans or risk management/business continuity plans
• Employees on pre-retirement contracts are still expected to participate in the Management for Performance System (MPS) with performance goals aligning with operational plans
• Funding to maintain the employer superannuation contribution at the employee’s pre-conversion rate over the contract period is by the school or service centre - no additional central funding is available
• Pre-retirement contracts may only be extended at the University’s initiative, by the delegated authority, and in exceptional circumstances with the total period not exceeding 5 years. Any extension is to be agreed 6 months before the expiry of the initial contract.

Whilst pre-retirement contracts provide a level of certainty around the retirement plans for individual employees and their school or service centre, it may not always be possible to offer or approve all requests.

Some possible alternatives to consider and discuss with either your line manager or HR Business partner include:

• flexible work arrangements to enable work activities to be varied or refocussed
• use of leave (e.g. annual leave, long service leave, unpaid leave, or purchased leave) to support retirement transition plans
• mentoring and coaching arrangements to pass on knowledge and expertise to other staff